The Pound Sterling (GBP) has dropped by -0.2% against the Euro (GBP/EUR) today following the UK trade deficit increasing and the results of the annual Industrial and Manufacturing Production both showing declines against forecasts.
NIESR could provide Small Boost to Sterling before Bigger BoE Events Tomorrow
Although the Pound (GBP) has been damaged by this morning’s negative data, there may yet be hope for a GBP/EUR exchange rate reversal in the afternoon. The influential NIESR GDP Estimate for August is out later today, and while no forecasts have been made, a 0.7% increase was the last recorded figure for the estimate.
The Pound Sterling (GBP) has risen by 0.4% against the Euro (GBP/EUR) today, no small feat given that the common currency (EUR) was bolstered by the Eurozone Q2 GDP unexpectedly rising from 1.2% to 1.5% today.
UK News is Bad News as First Major Weekly Data may Trigger GBP Softening Tomorrow
The Pound Sterling’s (GBP) advantage against the Euro (GBP/EUR) may fade overnight, which would leave the British currency vulnerable to on-forecast results in the UK Trade Balance figures for July that are released tomorrow. Predictions have been pessimistic across the board, although this has the double-edged consequence of meaning that a major reduction in the UK trade deficit against expectations would likely send support for Sterling through the roof.
A major rally has been unexpectedly triggered for the Pound Sterling to Euro (GBP/EUR) exchange rate today on an otherwise no-news day for the UK.
GBP/EUR Exchange Rate News: Sterling Soars after Glencore Actions Prompt FTSE Free-For-All
The Pound Sterling (GBP) has risen by 0.5% against the Euro (GBP/EUR) today and has seen far greater gains elsewhere. These include rises of over 0.8% against the Chinese Yuan (GBP/CNY), the Japanese Yen (GBP/JPY), the New Zealand Dollar (GBP/NZD), the Thai Baht (GBP/THB) and the Singapore Dollar (GBP/SGD). The top end of the GBP gains were against the Turkish Lira (GBP/TRY) and the South African Rand (GBP/ZAR), with Sterling seeing respective advantages of 1.5% and 1.3%.
This rally is entirely unexpected for today, given that no UK-relevant economic news was due for release. The biggest impactor on Sterling’s performance, therefore, is the selloff of mining and commodities trader Glencore’s assets in a bid to pay off its current mountain of debt. The move was extremely positive for the FTSE 100 Index, which rose by 0.9% today.
Euro Declines in EUR/GBP Pairing after Disappointing Sentix Score
The Euro (EUR) has fallen by -0.3% against the Pound Sterling (EUR/GBP) today, although elsewhere the common currency has performed well against downwards pressures. The German monthly Industrial Production score for July came in with a rise below forecasts, hitting 0.7% instead of 1.1%. However, given that the previous result was -0.9%, this can still be considered a healthy improvement for the Eurozone’s largest economy. The Eurozone Sentix Investor Confidence Survey for September showed a drop from 18.4 points to 13.6 today, a significantly worse result than the expected drop to 16.0.
Despite these mixed results, the Euro has risen overall today, seeing gains of over 0.3% against the Canadian Dollar (EUR/CAD), the Japanese Yen (EUR/JPY) and the New Zealand Dollar (EUR/NZD). The Euro’s greatest gain has been by 0.9% against the South African Rand (EUR/ZAR).
GBP/EUR Exchange Rate Forecast: Pound Sterling Stands to Lose Out Tomorrow due to Slow UK News Day
Although the Pound (GBP) has risen considerably against rivals today, this uptrend may not last into Tuesday. This is jointly due to the boost in Sterling confidence from the stock market events being likely to fade away overnight and because of the Eurozone Q2 GDP results coming out tomorrow.
By contrast, the only UK data tomorrow will be the BRC annual Like-for-Like Sales figure, which is considered low-impact and to drop from the previous 1.2% to 0.9% this time round.
Current GBP, EUR Exchange Rates
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3667 and the Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7317 today.